French Prime Minister Sébastien Lecornu will present the draft 2026 budget to his new cabinet on Tuesday – the first big test for his government as parliament prepares for a tense debate on spending cuts and debt.
Monday was the formal deadline for submitting the budget to the National Assembly. Under the Constitution, lawmakers have 70 days to examine and adopt it before 31 December.
Because of time pressure, the proposal is expected to be almost identical to the version sent to the High Council of Public Finances on 2 October.
That version already drew heavily on the previous plan by the previous prime minister François Bayrou but included fewer cuts.
Open for debate
While “not perfect”, the budget was “largely designed to allow for debate,” Lecornu said last week.
He indicated he could revise the deficit target to just under five percent of GDP, higher than the 4.7 percent planned earlier. But he insisted on keeping the long-term goal of cutting the deficit to 3 percent of GDP by 2029, in line with European Union rules.
Lecornu’s team faces pressure from Brussels and financial markets to show fiscal discipline after months of political instability in France.
However, an austerity budget remains deeply unpopular and leaves the government exposed to potential motions of censure.
The far-right National Rally filed a no-confidence motion on Monday, a day after Lecornu unveiled his new cabinet. The party said it would also back a motion from the hard-left France Unbowed, aiming to bring down the government and force new elections.
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Spending cuts
Lecornu is counting on support from the Socialist Party to survive the vote. That could mean reopening talks on the pension reform that took effect in 2023, raising the retirement age from 62 to 64.
The reform remains highly controversial. Lecornu has said he is willing to discuss a suspension – a key Socialist demand.
He has also promised not to use Article 49.3 of the constitution, which allows a government to push a bill through without a vote. Instead, he says his focus will be on reducing the deficit by cutting public spending.
He has said that his priority for reducing the deficit will be on cutting public spending, including a €6 billion cut in the state’s operating costs and tighter control of both social welfare payouts and spending by local authorities.
In terms of revenue, Lecornu has ruled out the so-called “Zucman tax”, supported by the left, which would introduce a minimum 2 percent tax on the wealth of the 1,800 richest taxpayers.
Though acknowledging a need for greater tax justice, he proposed a new financial wealth tax, which would target family holding companies that are sometimes used to avoid taxation, and which could generate between 1 billion and 1.5 billion euros.
(with AFP)
